TuneCore: first iTunes Match royalties are “magic money” out of “thin air”

The CEO of one music distribution service has declared iTunes Match a success …

Music distribution service TuneCore has described the royalties from iTunes Match as "magic money that Apple made exist out of thin air for copyright holders," signaling early support of the service from one part of the music industry. TuneCore CEO Jeff Price made the proclamation in a blog post on Tuesday, making the first iTunes Match royalty payments sound like nothing less than a miracle. Without any details on how much individual musicians are taking home, however, it's not clear whether iTunes Match pays better or worse than similar services.

TuneCore is a service used by many independent musicians and artists that allows them to distribute their music on major music stores like iTunes and Amazon. The idea is to use TuneCore's resources—instead of the artist's limited resources—to achieve wider distribution to a major audience, and for what amounts to as a minimal cost to the musician. TuneCore isn't the only service that does this—CD Baby is another popular option—but it remains one of the larger collectives of indie musicians online.

In his blog post, Price said the total amount of the first royalties received by TuneCore on behalf of musicians was $10,000, which was collected over a period of two months since the beginning of iTunes Match. This may come off as a bit low, considering that TuneCore represents huge numbers of independent musicians, but Price defended the number by stating, "before you were getting zero, now you are getting something."

"A person has a song on her computer hard drive. She clicks on the song and plays it. No one is getting paid," Price wrote. "The same person pays iTunes $25 for iMatch. She now clicks on the same song and plays it through her iMatch service. Copyright holders get paid."

It's worth noting that musicians who sell their music through iTunes end up being paid twice if they also receive royalties through iTunes Match—once at the time of purchase, another time after the user begins listening through iTunes Match. This also applies if the user purchased a physical CD, ripped it, and then used iTunes to match those tracks so they can be streamed to other devices. And in the unfortunate event that the original music was pirated and then became "legitimized" through iTunes Match—which some people believe is the entire purpose of the service—then the "something is better than nothing" approach may have some merit.

Of course, Price didn't break down where the royalties will go—undoubtedly, there will be some musicians raking in more than others, and there will be lots who barely make anything at all. But even musicians who are only making a fraction of a dollar on streaming royalties seem to appreciate the token payments in exchange for greater levels of exposure. For example, in a blog post authored last November, Matt Churchill wrote about the royalties he received from Routenote (another music distribution service similar to TuneCore), noting that just over 100 "plays" of his song netted a total of 65¢. "Now that might not seem like much to you, but that 100 plays is 100 more than we would have had otherwise," Churchill wrote.

Little is known about how much iTunes Match pays out per-play to record labels and distribution companies, but it's probable that it compares to other popular streaming services like Spotify. (Indie musicians aren't always happy about Spotify's "tiny" royalties, though according to Billboard, they are greater than royalties received from radio broadcasts.) Either way, it's clear that at least for TuneCore, the general feeling is that iTunes Match is so far working out.

"The music industry needs innovation. Services like iMatch, Spotify, Simfy, Deezer and others are bringing that innovation—it will take some time to learn which are the ones consumers want," Price wrote. "But in the interim, seeing an additional $10,000+ appear out of the thin air for TuneCore Artists by people just listening to songs they already own is amazing!"

"seeing an additional $10,000+ appear out of the thin air for TuneCore Artists by people just listening to songs they already own is amazing!"

This is telling: We already OWN the MUSIC. Why do we have to PAY FOR IT AGAIN!?!

You don't own the music. You never have. All you have is a license to listen to it on whatever you use to play it. That was always true. It just wasn't ever enforceable before. All you've ever owned was the physical media the music was recorded on.

"seeing an additional $10,000+ appear out of the thin air for TuneCore Artists by people just listening to songs they already own is amazing!"

This is telling: We already OWN the MUSIC. Why do we have to PAY FOR IT AGAIN!?!

You don't own the music. You never have. All you have is a license to listen to it on whatever you use to play it. That was always true. It just wasn't ever enforceable before. All you've ever owned was the physical media the music was recorded on.

"seeing an additional $10,000+ appear out of the thin air for TuneCore Artists by people just listening to songs they already own is amazing!"

This is telling: We already OWN the MUSIC. Why do we have to PAY FOR IT AGAIN!?!

Well, you don't have to pay for it again; it's only if you want the added convenience of cloud storage of your music that you have to pay extra. So essentially you are paying for a convenience which makes sense to me. That the money happens to also (partly) go to the music labels is quite besides to point :-)

This is telling: We already OWN the MUSIC. Why do we have to PAY FOR IT AGAIN!?!

You don't, if you don't subscribe to iTunes Match and manage the files across devices yourself.

If you want the added feature of listening to that same music on multiple devices, as supported on Apple's cloud servers, then you pay $25/year. The choice is yours.

(What's not clear from this article is the breakdown of the $25. How much is for Apple's server/store infrastructure, and how much is allocated for royalties? What if you compose and record your own music and then upload it to iCloud? Who tracks all the royalties and payments?)

"seeing an additional $10,000+ appear out of the thin air for TuneCore Artists by people just listening to songs they already own is amazing!"

This is telling: We already OWN the MUSIC. Why do we have to PAY FOR IT AGAIN!?!

You don't own the music. You never have. All you have is a license to listen to it on whatever you use to play it. That was always true. It just wasn't ever enforceable before. All you've ever owned was the physical media the music was recorded on.

Exactly. Music companies have double dipped for years with no appreciable benefit to the consumer, for them it always seemed a case of how can we extract the most amount of money for the least amount of effort. Apple (and Google/Amazon) said “Okay here’s a service we think has some value to you (the consumer), it costs $25 a year if you’d like to use it.” Copyright holders get a little extra cash, Apple gets a service that makes their iOS ecosystem “sticky”, consumers get a service beneficial to them.

Apple (and Google/Amazon) understand the way to make money with content is to make it available, reasonably price it and make it easy. The tired, unimaginative baby boomers sit in their corner offices dreaming up ways to make content less available, more expensive and harder to use and then whine to the government because they’re losing money.

As Match gains users, this payout will continue to grow. Possibly, after some time, it could amount to ten times that number, possibly even more.

My cousin always used to tell me how smaller radio stations, and even some big ones, would not pay the fees required, and that composers and musicians would lose as much as 50% of their income because of that. It didn't matter as much to him, because he and his wife did so well, but it mattered to the lessor people in the industry.

As was noted, 100 plays netted $0.65. That's actually a lot for something like this. 100 plays is nothing. If we take 1,000, we can see something more real. As always, those who are more popular will receive much more than those who aren't. That's how it should be, and crying about indie, or anyone who isn't popular not making much is misplaced. If people aren't interested in your music, that's too bad, but perhaps they should be doing music that is appreciated. If they don't want to, or can't, then they get what they should. That's the way it's always been throughout history.

You really own the music you bought. Copyright law means there are restrictions on copying that music. That's all. There are also laws about where and how you can drive your car - does that mean you don't own your car?

"seeing an additional $10,000+ appear out of the thin air for TuneCore Artists by people just listening to songs they already own is amazing!"

This is telling: We already OWN the MUSIC. Why do we have to PAY FOR IT AGAIN!?!

You don't own the music. You never have. All you have is a license to listen to it on whatever you use to play it. That was always true. It just wasn't ever enforceable before. All you've ever owned was the physical media the music was recorded on.

Exactly. Music companies have double dipped for years with no appreciable benefit to the consumer, for them it always seemed a case of how can we extract the most amount of money for the least amount of effort. Apple (and Google/Amazon) said “Okay here’s a service we think has some value to you (the consumer), it costs $25 a year if you’d like to use it.” Copyright holders get a little extra cash, Apple gets a service that makes their iOS ecosystem “sticky”, consumers get a service beneficial to them.

Apple (and Google/Amazon) understand the way to make money with content is to make it available, reasonably price it and make it easy. The tired, unimaginative baby boomers sit in their corner offices dreaming up ways to make content less available, more expensive and harder to use and then whine to the government because they’re losing money.

Most people are willing to pay for convenience. That's a good thing, or there would be little innovation. That innovation has to be paid for somehow, and the best way is to charge those who use it. That's no different than paying for a car, or renting one when you need it. Or paying for cable.

You really own the music you bought. Copyright law means there are restrictions on copying that music. That's all. There are also laws about where and how you can drive your car - does that mean you don't own your car?

No, you do not. Why don't you actually read the copyright law, instead of making it up as you go?

While I am happy to see that indie artists are getting paid, I'm not exactly thrilled with the idea that royalties have anything to do with private streaming or cloud storage. I know part of this has more to do with how iTunes Match is set up to reduce redundancy but the attitude expressed by the following is troubling.

Quote:

A person has a song on her computer hard drive. She clicks on the song and plays it. No one is getting paid... The same person pays iTunes $25 for iMatch. She now clicks on the same song and plays it through her iMatch service. Copyright holders get paid.

Maybe I'm reading into it too much but there seems to be the implication that copyright holders should get paid whenever a user plays a song they have on their hard drive. I sincerely hope that never, ever comes to pass.

You really own the music you bought. Copyright law means there are restrictions on copying that music. That's all. There are also laws about where and how you can drive your car - does that mean you don't own your car?

You don't own your car. You never have. All you own is the physical media the car was constructed out of.

While I am happy to see that indie artists are getting paid, I'm not exactly thrilled with the idea that royalties have anything to do with private streaming or cloud storage. I know part of this has more to do with how iTunes Match is set up to reduce redundancy but the attitude expressed by the following is troubling.

Quote:

A person has a song on her computer hard drive. She clicks on the song and plays it. No one is getting paid... The same person pays iTunes $25 for iMatch. She now clicks on the same song and plays it through her iMatch service. Copyright holders get paid.

Maybe I'm reading into it too much but there seems to be the implication that copyright holders should get payed whenever a user plays a song they have on their hard drive. I sincerely hope that never, ever comes to pass.

It's called a performance royalty. Every time a song is played, when broadcast, there is a very small fee attached. You aren't actually even allowed to take a boom box out to the street and play music without getting permission from the appropriate copyright holders, and payment associations. It's why bars, and restaurants, must get rights to show various sports and music events to their customers.

Some of us may not like it, but it is what it is. Apple is playing along, as opposed to what Amazon and google are doing. But they can't have a service like Match because they refuse to pay rights holders. So you must upload all of your music first, and that's all you can listen to. There are other restrictions as well. The services are much more limited.

And by giving pirated music a legal standing, this is doing a service for everyone. It legitimizes that music, and gives payments to those who should be getting them, and gives you better quality.

And really, you're paying for the service, not for the music per play. That something Apple and the holders have to worry about.

You really own the music you bought. Copyright law means there are restrictions on copying that music. That's all. There are also laws about where and how you can drive your car - does that mean you don't own your car?

You don't own your car. You never have. All you own is the physical media the car was constructed out of.

(Wait, is that how the argument is supposed to go?)

Actually yes. You don't own the design or any intellectual property that went into making the car. If you had access to a machine that could perfectly clone your car, it would not be your right to sell the clone.

You really own the music you bought. Copyright law means there are restrictions on copying that music. That's all. There are also laws about where and how you can drive your car - does that mean you don't own your car?

You don't own your car. You never have. All you own is the physical media the car was constructed out of.

You really own the music you bought. Copyright law means there are restrictions on copying that music. That's all. There are also laws about where and how you can drive your car - does that mean you don't own your car?

No, you do not. Why don't you actually read the copyright law, instead of making it up as you go?

A copyright holder only has some rights over the copy that you own. e.g. https://en.wikipedia.org/wiki/Copyright ... ive_rights You do own the copy of the music, because (among other things) you are allowed to resell the music without getting permission from the copyright holder. Generally, you can do anything you want with your copy - modify it, destroy it, use it as a coaster - and the copyright holder can't prevent you. Only copying, transmitting, exporting etc. are restricted.

itsbenaltogether wrote:

tesseractive wrote:

You don't own your car. You never have. All you own is the physical media the car was constructed out of.

(Wait, is that how the argument is supposed to go?)

Actually yes. You don't own the design or any intellectual property that went into making the car. If you had access to a machine that could perfectly clone your car, it would not be your right to sell the clone.

I'll echo the others' impression that this is being treated as little more than a way to monetize listening to music someone already paid for. iTunes Match isn't like radio station which uses and plays a bunch of music you've never bought, it's only playing music you own. It's perfectly reasonable for Apple to get money for providing that service, but what services are the artists and labels providing the user with? The customer has already bought their music, where's the additional transaction? The labels aren't the ones providing the streaming service from you computer to your iPod.

I think this discussion is getting bogged down on the word "own" (and how it applies to the various aspects of media, both physical and as represented by ephemeral bits.) I don't profess to understand all the legal nuances, but someone who does should spell it all out clearly before things gets too ugly.

I'll echo the others' impression that this is being treated as little more than a way to monetize listening to music someone already paid for. iTunes Match isn't like radio station which uses and plays a bunch of music you've never bought, it's only playing music you own. It's perfectly reasonable for Apple to get money for providing that service, but what services are the artists and labels providing the user with? The customer has already bought their music, where's the additional transaction? The labels aren't the ones providing the streaming service from you computer to your iPod.

Well, I think they're saying that's supposedly a "performance". I find that logic a little hard to follow. Say I have a removable drive that I load my music on. I can listen to it there. That's not convenient enough so I share the folder on a wireless network. Then I add a media device that streams it from my computer to my stereo in the other room, or my kitchen, or both. That still isn't convenient enough as when I leave my home, I often forget my drive. So now I pay for an online service to store my music so I can access it anywhere I can gain an Internet connection.

What I don't understand is where the transition takes place from it not being a performance and thus not subject to royalties, to being so. In my IT mind, cloud storage is just another storage device. The fact that it occurs over the Internet doesn't change things. That'd be like saying a network drive isn't really storage because it's using a network protocol as its transport medium, when everyone with eyes can see they're one and the same. Storage is storage, whether it's directly cabled like SATA, iSCSI over your local network, or a cloud storage solution out on the web.

For any of you having a hard time with this, just forget that the performers are getting paid anything for this and pretend that the $25/year pays for the convenience of having all your music with you anywhere you go.

You really own the music you bought. Copyright law means there are restrictions on copying that music. That's all. There are also laws about where and how you can drive your car - does that mean you don't own your car?

You don't own your car. You never have. All you own is the physical media the car was constructed out of.

(Wait, is that how the argument is supposed to go?)

Actually yes. You don't own the design or any intellectual property that went into making the car. If you had access to a machine that could perfectly clone your car, it would not be your right to sell the clone.

All facetiousness aside, the reason you do own your car is that owning the physical instance is simply what we mean when we refer to owning a physical object. Owning the mechanical reproduction rights isn't necessary.

For example, here's a conversation that I doubt any of us has ever had:

"Do you own a table saw?"

"Well, I have an instance of one, but I don't own the rights to a design for one."

For any of you having a hard time with this, just forget that the performers are getting paid anything for this and pretend that the $25/year pays for the convenience of having all your music with you anywhere you go.

The entire point of this article is to bring the payment to performers/labels to our attention, so no.

superchkn wrote:

Wheels Of Confusion wrote:

I'll echo the others' impression that this is being treated as little more than a way to monetize listening to music someone already paid for. iTunes Match isn't like radio station which uses and plays a bunch of music you've never bought, it's only playing music you own. It's perfectly reasonable for Apple to get money for providing that service, but what services are the artists and labels providing the user with? The customer has already bought their music, where's the additional transaction? The labels aren't the ones providing the streaming service from you computer to your iPod.

Well, I think they're saying that's supposedly a "performance". I find that logic a little hard to follow. Say I have a removable drive that I load my music on. I can listen to it there. That's not convenient enough so I share the folder on a wireless network. Then I add a media device that streams it from my computer to my stereo in the other room, or my kitchen, or both. That still isn't convenient enough as when I leave my home, I often forget my drive. So now I pay for an online service to store my music so I can access it anywhere I can gain an Internet connection.

What I don't understand is where the transition takes place from it not being a performance and thus not subject to royalties, to being so. In my IT mind, cloud storage is just another storage device. The fact that it occurs over the Internet doesn't change things. That'd be like saying a network drive isn't really storage because it's using a network protocol as its transport medium, when everyone with eyes can see they're one and the same. Storage is storage, whether it's directly cabled like SATA, iSCSI over your local network, or a cloud storage solution out on the web.

Yeah, and the device you're listening to it with is the same device you listen to local files with. In fact, the rough way iTunes Match works is that it makes a local copy which you then listen to on the device. How are the existing local files not also a "performance" if the same logic is applied? What about music on separate storage media, like microSD cards (obviously not with iPods, though), isn't that transferring the copy in a similar way to networked streaming? It's basically "remote" access, even moreso since the track isn't being transferred from one storage site to another and then played.

Apple (and Google/Amazon) understand the way to make money with content is to make it available, reasonably price it and make it easy. The tired, unimaginative baby boomers sit in their corner offices dreaming up ways to make content less available, more expensive and harder to use and then whine to the government because they’re losing money.

While self-congratualtory hipsters tweet their fixie specs and think they invented cool.

See how fun it is to play generational asshattery? At any rate, if you think everyone making decisions in the music industry is over 50 and that "boomer" suffices as shorthand for evil, you're not really paying attention. Although blind prejudice saves time, I guess.